24 April 2008

In my previous post, I talked about the new threat of ‘illegal downloading’ (colloquially termed ‘piracy’) which is changing the business of music, globally. For one thing, most music lovers are switching from buying CDs to digital music, downloading them piecemeal (i.e. track by track) from the Net onto their personal computers.

Of greater concern is that most of this downloaded music is not paid for. It is passed on by friends, or downloaded from peer-to-peer music/video sites (known as ‘illegal file sharing’). The music industry is losing sales and, therefore, unhappy. So, how is the music industry responding to this new threat?

Well, most recording companies are worried, being slow to embrace the digital technology as quickly as their consumers have. However, according to the industry representative, the IFPI, the music industry has not been left behind:

“Music sales via online and mobile channels have risen from zero to an estimated US$2.9 billion – 15 per cent of industry sales – over the last five years, making music more digitally advanced than any entertainment sector except games.”

Online retail music stores like Amazon.com or Apple’s iTunes Store have been sampling and selling music in digital formats for a while now. According to the IFPI report I quoted from earlier, “There are more than 500 legitimate digital music services worldwide, offering over 6 million tracks – over four times the stock of a music megastore.” According to an IFPI survey, legal digital music sites (e.g. iTunes Store) offer a wider choice of music/tracks per artist and better quality music than illegal sites.

At the moment, the music industry’s strongest initiative seems to be talking to Internet Service Providers and governments of individual countries for cooperation – to put an end to illegal downloads and copyright infringing services (e.g. Limewire).

This apart – and to answer a query raised in the comments to my previous post – the musicians themselves are innovating ways to reach their fans online – and on mobile. Here are some examples from a recent article on BBC news:

“Bristol band Portishead will release their new album on a music streaming service a week before it goes on sale in the shops. All 11 tracks from the album, Third, will be available from 21 April on Last.fm. It will be free to listen to the tracks online, but users will have to pay to download the tunes to their computer or digital music player. The music industry hopes free streaming will cut illegal downloading.

REM launched their new album, Accelerate, on the music streaming service iLike last month.

Madonna has signed a deal with Vodafone to make her new album, Hard Candy, available on mobile phones from 21 April, a week before its official launch in the shops.”

I’m sure we’ll see more innovations in the future. For the time being, digital technology and mobile communications have come to the musician’s rescue. And, the music industry seems to have entered its second life.